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WeWork Sues China Co-Working Rival as Legal Fight Escalates

The U.S. startup, which has been valued at about $20 billion, filed a lawsuit against UrWork in New York on Tuesday, saying it copied parts of its name and logo.

(Bloomberg)—WeWork Cos. is escalating a legal fight against UrWork with a U.S. lawsuit, accusing the rapidly expanding Chinese rival of infringing on its trademarks.

The U.S. startup, which has been valued at about $20 billion, filed a lawsuit against UrWork in New York on Tuesday, saying it copied parts of its name and logo. That follows a separate legal action taken against the Chinese company in London with WeWork accusing it of “passing off,” which can take place when one business misrepresents their services as being the product of another. UrWork didn’t immediately have comment outside of business hours in Beijing.

Shared offices are gaining in popularity as bootstrapped startups seek to lower costs and collaborate with peers. The legal salvo sets up a clash between two startups racing to open locations around the world, renting desks, conference rooms and other workplace essentials to teams and entrepreneurs in urban centers. While WeWork remains the largest global provider of such spaces -- known for their coffee and beer kegs -- UrWork is the leader in its home market and preparing to enter London, Singapore, New York and Los Angeles.

“WeWork has invested substantial time and money building a superior brand to ensure that our brand name is uniquely associated with WeWork and its offerings,” a WeWork spokesman said. “UrWork has no physical presence and no brand equity in the United States, so there is no reason for them to enter our home market with such a confusingly similar name.”

The Chinese startup’s name shared defining characteristics with WeWork’s trademark, specifically a two-syllable word beginning with a two-letter pronoun and joined with the word “Work,’’ it said in the filing. It also claimed UrWork’s logo, mobile app icon and office design resembled its own.

WeWork’s lawsuit also named Serendipity Labs Inc., which it said is partnering with UrWork on its U.S. expansion.

UrWork argued in response to the London case that its brand was an interpretation of the shared working industry and philosophy, that the word “work” was a commonly used term and that “UR” was very different to “WE.”

WeWork and UrWork will increasingly encounter each other as they pursue global expansion.

WeWork’s been amassing funds to bankroll a global push that’s already taken it to about 15 countries. It scored $4.4 billion from SoftBank Group Corp. and its Vision Fund at what’s said to be a $20 billion valuation, and just unveiled a deal to buy Singapore’s SpaceMob and open its first locations in Southeast Asia. It’s also announced a $500 million investment with SoftBank and Hony Capital to expand its business in China -- UrWork’s home turf.

UrWork too is well-funded, having raised $236 million in the past few months to help finance a plan to establish 160 locations across 32 cities worldwide over the coming three years, according to its website. This month, it announced an investment in Indonesia’s ReWork, taking it to Southeast Asia’s largest country.

Apart from opening offices, the Chinese company -- backed by Sequoia Capital and a fund linked to billionaire Jack Ma’s Ant Financial -- is expanding into related lines of business such as legal services. The two-year-old firm now has about 78 offices across 20 Chinese cities, while WeWork operates just a handful of locations in Shanghai and Beijing, with several more on the drawing board.

UrWork plans to open its first U.S. location, in New York City, later this year. WeWork has 38 locations there and more than 200 current or planned locations around the world, according to its website.

--With assistance from David Ramli.To contact the reporter on this story: Ellen Huet in San Francisco at [email protected] To contact the editors responsible for this story: Robert Fenner at [email protected] ;Mark Milian at [email protected] Edwin Chan

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© 2017 Bloomberg L.P

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